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Bill Gross Telegraphs QE2 Green Light: Buys MBS On Margin
Who cares what Benny and the Inkjets blink in morse code when you have the one and only Bill Gross. As we said last month, the best necessary and sufficient tell to decide what the Fed will do on November 3 is to keep track of the Total Return Fund's composition. Today, TRS just released its updated September holdings, and for all those hoping to see that Pimco Billy is betting the farm on QE2 - that's a bingo. Pimco has just increased its MBS holdings to the highest since July 2009, when Gross was already dumping MBS on the tail end of QE1. The biggest tell however, is that just like before QE1 abd QE Lite were announced, Bill has once again gone on margin, reducing his net cash exposure from $5 billion to ($7.6) billion. And keep in mind this is September: we are certain that once the October results come out, a few weeks after QE2 is effective, TRS will have a material margin position of more than $20 billion, and will have pumped up its MBS holdings up to $100 billion. So now that we are certain that Gross just telegraphed that QE2 is imminent, that leaves us with two questions: 1) why MBS and not USTs? Is Gross saying that Bernanke will once again be forced to come out and buy MBS in addition to USTs? or 2) did Gross just get screwed on his doubling down MBS? With fraudclosure forcing such reputable MBS managers as Gundlach to claim that it will have no impact on their business model, we are also certain that the entire Fashion Island campus is sweating bullets currently. If the entire MBS model is indeed unwound as some speculate, this could well be the end of PIMCO (and how poetic that would be). Yet these are considerations for the future. For now - anyone who may have had an ounce of doubt as to Bernanke's FOMC announcement intentions, can now put it away.
TRS portfolio updated through September. Note the MBS holdings and the dotted net margin exposure.
TRS duration distribution. No doubt the drop is predicated by the ramp in MBS holdings.
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Here's hoping his insider tip this time is false.
It won't be false.
Bernanke, the inside tipster, knows that Gross alone could move the market and seriously upset Ben's plans if Gross is screwed.
So Ben won't play with Gross because Gross brings his own bazooka to the party and Ben needs it in the game, having expended his own readily available ammunition.
Well said CD - PIMCO can definitely impact Ben's plan - its a shame Mr. Bernacke lacks the integrity to defend the currency rather than eradicate it -
Well put. It's mutually assured destruction, except that unlike the Cold War scenario, the rest of the world loses.
What the hell is happening to the 10 year yield? Jumped big time!
if Gross got early word that the Fed's master QE2 plan will be to buy billions in MBS instead of the long end of the Treasury curve. it could all make perfect sense. the 10 year is increasing in yield in the last week. that could mean Gross is selling. in that case, we should see massive accumulation of MBS in October for PIMCO, and selling of the long end of the Treasury curve.
i'm not sure what that means for mortgage rates though. with the long end yields rising, that would put pressure on mortgage rates to move higher. however, i'm not sure how billions in MBS purchases by the Fed affects mortgage rates.
Bernanke buying more MBS right now would be like someone jumping on the Titanic after it hit the iceberg. Is he that retarded? Maybe not. Is he that corrupt? Most definitely. I guess it's more like him throwing another load of taxpayers onto the sinking ship as he doles out lifeboats to rich bankers...
MBS are NOT fungible in the same way that treasuries are. Will it be purchase of old or new issue MBS? I suspect old.
If he does it he would buy old MBS, because those are the massive thorns in the sides of his owners. New MBS most likely won't have the same title issues and therefore still have some value for the banksters.
the 30 year moved higher too, just enough to be a white flag on a whiter shade of pale background.
I have a feeling that we will be calling all the angles to help us see thru the coming mess when worlds collide.
today's selection comes courtesy of my little sister's itunes. she has impeccable taste in music and it is certainly worth sharing. however, this is not the EDM you are looking for. rather an eclectic collection of bump. i did not include her favorite country songs. as far afield as this playlist is i thought that would be a bridge too far.
coisas da irmã (a playlist):
http://www.youtube.com/view_play_list?p=B66475A34C59B734
and as a supplement, a flashback to a month or two ago
2cool (4skool) - a good ol fashioned boom boom ass-kick EDM playlist: http://www.youtube.com/view_play_list?p=12689F04C0CEEF6C
and don't forget to check out the RadioZero site to listen to some sets there available for streaming or download (they're far better than what i can put together so massively worth checking out)
http://radio.cl.zerohedge.com/
lol...FAIL...ok...junkimus maximus...no more postings of this today
Can you string Dark Side of the Moon together in one of your hit lists? Rather appropriate right now.....
maybe next week, i think i've been junked out today :)
got some party poopers around here, i always check out the stuff you post, keep it up
If not for the relegation of our fair sister to anonymity, we as a collective would be rocking our friggin' minds out at least once a month to her stylish sounds. But alas we are offered a welcomed effort at a semblance of what could be a la Sr. Bistec (Steak). He should get a fucking medal for his efforts.
Our dad used to be a rockstar in Portugal so music definitely is strong in our family :D I really appreciate the kind words from you and "I am". I'll keep on bringing tunes (on a more sporatic basis though) and would highly encourage y'all out there to put together playlists for us ZH readers.
I'm not phazed by the junking, but one has to know when to call it a day and that is as sure a sign as any since it comes from da people.
Party on!
That's great! I love to get a little levity with my side order of seriousness at the end of the week. Let me further your idea of sharing tunes. Below is a link to some "real" music, a compilation of live recordings/performances of the Who in all their mod glory, 1965-66:
http://www.youtube.com/view_play_list?p=BBD0DEB249025BA3
tuned in and will bump from beginning to end, thank you sir. you'll be pleased to know this will be my most immersive experience with the Who.
An additional note to all...when posting a playlist PLEASE make sure your youtube/google profile has all the necessary anonymity protections.
me and peggy owen's got into one of the who's motel rooms after a concert in ohio. we were both virgins so it was fun just to be groupies.
Steak --
Why would a predator like you care what the cattle think?
Tyler ---
Why do we have a "junk" button available, but when people want to explicitly agree with someone they can only put "+1" in their reply?
If we have a -1 button, we need a +1 button too.
moo :-}
Knock, knock...
Who's there?
Impatient Cow.
Impatien-
Mooooooooooo!!!!!!!!
8)
I sort of like NOT having a thumbs up/down button. Too much of a popularity contest. The MarketWatch boards get so cluttered with the inane comments looking for the reaction of the crowd.
I try to reserve my junks for trolls, ads, etc. Hardly do it, and only after an explanation...
Second that.
Keep posting Steak. That's what makes ZH an interesting blog/community...
Just rubbin' some the right way...
Fly your kites champ they're awesome
and many I have never heard before.. A big thank you to you and yours
Steak, I wouldn't junk you, and I'll get to Prodigy in a sec because for whatever reason whenever I hear them my head nods, but junking is for the guy on the other page calling himself Cheesy Bastard, for gold trolls, and for people calling other people out (making this post junk worthy). Anyway, I feel that music helps give sense to our emotions, and that are emotions are of the upmost importance. The DJ has this power, and the world is always in need of a DJ!
Passion Pit is great. I call their music, "The happy sads."
"For You Blue" is a favorite, thanks for reminding me.
Saw them open for Muse last week. Was as an interesting combination, but Muse smashed it.
Noticed the Prodigy comment above, you ever slip from there into drum&bass or dubstep?
I don't believe it. That would be unscrupulous and a violation of securities rules. I'm sure he's sitting around firing blindly into the night like everyone else.
This can't be true.
Maybe he really really really thinks that the smoldering pyramids of dog shit MBS's are undervalued without QE2.
If they can print to infinity, they can use the PDs and their (PIMCO-like) networks to buy everything. Our debt, our stocks, and certainly more toxic MBS. When the gig is up, they'll already be on the G6 headed to the place with their physical gold while they profit from the $26Trillion in insurance policies against it blowing up. http://creditlime.com/ But they'll have to collect that right before the extreme exponents of hyperinflation set in, so they can cash out of the worthless USD it paid.
Now get with the program. Someone has to keep buying this shit, right? It was Bill's turn is all. Did you see how much the Fed is showing on their balance sheet?
Have you got a link where I can see exactly what they're holding?
Credit Default Swaps are unregulated and because they get traded so frequently there is uncertainty of who owns them and whether the holders can actually pay in the event of a negative credit event.
The size of the credit default market dwarfs that of the stock market and the bond market they represent. Therefore, this shows that credit default swaps are being used for speculation and not insuring against actual bonds.
I copy/pasted the above from somewhere. The point is, our leveraged ETFs, like the ones we might use to short indices (TZA, FAZ, DRV, etc..) are based within layers of this dark swaps market. Unfortunately, the ISDA wanted a $100 million deposit to buy my own. But the big banks are the ones who issue them to those with a spiffy ISDA card, and hey, they're just "making markets."
I was checking out CreditLime, thanks for that.
No one knows who is on the other side of anything anymore--mortgages, cds. Except the PMs in our pockets--no mysteries there.
It is so strange to make ourselves think like the slimy crooks (the ones who bet against the products they are selling). I can't even think like that.
Since there is no CDS prospectus to send you, I find this strangely comforting:
http://www.garynorth.com/goldwars.pdf
JPM, GS, BAC, C hold 95% of all CDS contracts either as originators, buyers, MMs in synthetics or LPs in synthetics [which is bullshit since there is barely any liquidity in more exotic forms of synthetic products such as TABX etc etc]. Hope that helps. The rest is spread among hedge funds, pension funds etc etc.
Cheeky you old Bastard, how's it hanging?
Thank you for stopping by. Hope you're feeling well. We were also graced with an appearance by Deadhead last night. It warms the cockles to see the ZH veterans now and then if for no other reason that to chase the tourists away. :>)
BTW you received the ultimate compliment when someone registered here as Cheesy Bastard and hijacked your avatar. You know you've hit the cultural radar when your "brand" has been knocked off. :>)
Hello man. Everything is fine. Better than. Hope all is well with you too.
Yeah, I saw the dude/girl. Shit, what can I say man, except "Knock yourself out buddy".
I will try to be more "regular" but with the influx of all the "tourists", dont think it will happen. Still love the place and read daily, but just dont comment anymore.
So, until next time stay well man.
sup fucker :)
you know where we are, come find us, we miss you. also, how about upgrading my friday and posting a link of a cool poem?
I know where you are, but you also know why I am not there anymore.
Oh, Ok. This should be a good one:
if I suffer at this
typewriter
think how I'd feel
among the lettuce-
pickers of Salinas?
I think of the men
I've known in
factories
with no way to
get out-
choking while living
choking while laughing
at Bob Hope or Lucille
Ball while
2 or 3 children beat
tennis balls against
the wall.
some suicides are never
recorded.
Cheeky,
You may not have seen it, but Steak informed the ZH community a week or so ago what happened to you and why you aren't around anymore while naming names. So some people are very sympathetic of your situation, as am I. Just thought you should know if you didn't already.
BTW thanks Steak.
CD keepin it real
d(-_-)b
respek knucles: http://www.youtube.com/watch?v=geZSBEi9afo
*nod* good to see ya out on the patio tho
love the poem, be well
miss you Cheeky!!!
Learned so much from reading your comments ... sigh please drop by when you have time
Bank run Monday?
I am sure he only buys AAA!
Well, shit, I guess I've got to buy more fucking silver before November 3rd.
Thanks for the heads up, TD. I was thinking about buying some other things (solar panels, food preservation tools, etc), but I guess it's going to be all metals next month as well.
More silver and more lead...of the high velocity type that is.
I say he's Fucked. Never was one for thinking he had a direct link...just couldnt join the dots for some reason, no matter how fanciful.
No way. Gross is just making himself a one-stop shop for Bennie and the Inkjets. You know, efficient markets and all that.
MBS are the elephant in the glass shop.
Ben must buy alot of those me thinks.
While he is at it he could give me some pocket money for this weekend.
"elephant in the glass shop"? Is that the same as a bull in a china shop?
seb - Ding, ding, ding! You are today's big winner. Yes, it is the big elephant in the glass shop. And hopefully that glass shop sells devices that will allow you to inhale some of California's finest because we will all need to chill out once we realize fraudclosure means QE3. QE2 is for US Treasuries so that the Fed can attempt to keep rates down and further debauch the USD. However, QE2 has been being kicked around for months now. Fraudclosure is the new kid in town and literally threatens to spin the wheels right off the fiat money, hyper-leveraged economic model our beloved banks must suck off of to survive. Therefore, to save the balance sheet of the TBTF banks, of PIMCO/BlackRock/Capital/Fidelity/et al. and, of course, the Fed itself, Benny will soon be forced to buy every MBS on offer, which will be every MBS. Read Gonzalo Lira's piece from yesterday (http://www.zerohedge.com/article/gonzalo-lira-second-leg-down-americas-death-spiral) as he explains the potential downside of fraudclosure better than anyone else yet. Reggie Middleton also has this one down pat.
So Gross's trade idea is so simple even Paul Krugman gets it. He is sitting across the poker table from someone holding 2, 7 offsuit and is all-in. He knows he's going to win this one. Buy MBS at a discount from par, on leverage thank you very much and wait for Ben to be forced to back-stop the MBS market. Again. Once he does, you sell it all to Brian Sack at par and count your money. This should keep the extend and pretend fantasy alive for at least another 6 months.
Btw, as others have alluded to above, because Gross is such a big fish in the US Treasury market, he knows the dynamic duo of Ben and Timmy won't let him get screwed. Therefore, Billy G is not-so subtly telling the boys what their next focus will be. MBS.
You want some pocket money and the chance to front-run clueless Ben and Brian "da" Sack? Buy some MBS and wait.
It's going to be MBS' first. They have no choice if they want banks and credit markets to stay functioning (at least in their mind). My personal feeling is that they are going to SuperSize QE2 to allow themselves some room to manipulate the 10 year.
TD -- good stuff.
But didn't Gross say yeaterday that he is selling treasuries because QE2 won't be big enough?
Nice, might as well bring the madness in the holiday season. Not enough suicides already. This kind of chicanery is going to make my gifts of silver rounds at Christmas a much bigger hit then last year.
Makes sense to me. The infrastructure for inflating the fuck out of real estate is already well in place.
The Fed wouldn't want to let old Bill down - otherwise he'd have to sell his treasuries to satisfy his margin call.
Maybe Billy is planning on putting all the discounted MBS he bought back to issuing banks at par like everyone else.
Dumb like a fox.
Art Cashin always said, Its all about the Dollar.. It is the only thing thats driving this market. Right now DXY up .39, So Im a little suspicious at this point. Could it be Bernanke is full of shit? We shall see.
Or could it be Ben is trying to cool down the overheated speculative market? Ben can never meet the market expectations at this point so he needs to lower expectations. What better way than to engineer a market "disappointment" after his speech, followed by a slow market deflation over the next three weeks to elections?
He got what he needed, a market rise to calm a population that was expecting a September/October market swoon. Mission accomplished.
I still think Bernanke will do whats right if our beloved Dollar takes its second to last breath before sinking into the abyss.
You mean like pull the final trigger and put us all out of our misery?
He will do that ONLY if the banks approve of his actions at which time banks will have built up significant short positions or puts !!
I think they have.
Remember the ZH article from the other day showing that short positions haven't diminished despite the Sept/Oct ramp?
So who do you suppose is getting short to make up for those who fled? :>)
People are front running the QE 2 trade right now; buying bonds, and selling equities. But I bet the Fed is gunning this action; Bernanke buying AAPL, emerging market ETFs, maybe even selling some of what they just picked up in POMO. He is probably making weekend lunch plans with Shirakawa right now, reading MHFT blog, thinking, 'I wonder how much gold I can lease? I wonder what my maximum leverage can be?' And calling Kkkrugman for advice, "Paul, at what point do I buy gold?" "Buy gold???!" Kkkrugman responds. They both have a laugh then. At this point I think he thinks his best bet is to fully leverage the economy, and then get out of dodge; have the Fed own EVERYTHING, and then bail. He most likely thinks, 'Well, once the Fed owns everything, we can really set prices! So when forclosuregate wrecks havoc, we will save everything.' Benevolent price setter, and he loves setting prices. Strangely, can't figure out gold. "What is all this gold doing down here!?" "This is the Fed gold vault sir." "Well get rid of it! We don't need no stinkin' gold!" "What will we back our debt with sir?" "Back our debt? What? My word isn't good enough?"
Really though, I do not mean to confuse the situation, as the Fed does not sell, but only leases Tungsten, er...I mean gold.
You're thinking about it all wrong. The pigs don't buy then hope the fed picks the stuff they have. A favorable environment is created and whatever accidental losers pimpco has the fed will buy for face value. The fed is a dumping ground for maggot losers.
Timaaaaaaaayyyy !!
Timmay needs to go to prison.
Fuckin A!! Good to see you back pal....
About that, how about soon, before he buys a one way ticket to W's Ranch Americana.
I do not think Ben can do QE or anything of substance at this point because he may be getting hammered on the near worthless MBS he bought up from the banks in 09 because of Fraudclosure. So if he steps in and buys more and further grafts the markets survival into his actions he creates a scenario where if he attempts to back the Federal Reserve out ever the markets will collapse.
What good is buying more worthless paper that will become even less valuable in the coming years accomplish? Bruce Krasting is 100% correct Ben cannot step out of the markets and that is because with each collapsing bubble the markets became even more reliable on the Federal Reserve. And this is why the markets collapsed only a few years after rates began their upward climb.
The U.S. stock market now can now not only not survive on higher interest rates but it cannot survive with QE which eventually Ben will no longer be able to perform eventually. If he does QE 2 than the markets will frontrun the tail when it is nearing an end and the markets will collapse even faster and calls for QE3 will resume and by then rates will be 2% and nobody will be buying homes and we still will not have job growth.
At that point with retail even further removed from the ponzi it is going to be mortal kombat for the trading desks to steal each others profits. And this is not even considering a dramatic shift in the political landscape. Just imagine if Ron Paul is actually the front runner by 2012.
Yes, this is the positive feedback loop that leads to extreme inflation and political collapse.
I mean, Zerohedge would be a nothing website without all these banking scandals. No one would give a fuck about the Fed. It would remain a niche topic of interest for intellectuals and finance professionals. The more inflation, the less political credibility the existing government has.
So, I say... bring on the printing!
We reach a point where it feels like they are doing this purposely to destroy our nation from within. They all seem to think they can deal with the problem tomorrow. Well tomorrow is almost here. In fact it may have been yesterday.
That is very well spoken, I intend to steal that in my future conversations with people.
Pull up the interview with James Hamilton about justifying deeply negative rates. Putting aside the shillery, the money quote came when asked about inflation in wages. his response: "well no guarantee of that making the policy of reflation uncertain" (paraphrase).
Welcome to dsytopia
"It is not a bubble if people are buying it"
Another classic. The man defined what causes a bubble and didn't even know it.
the real bubble is common man "wages". To reset, pop if you will, all wages to a worldwide equal level, that is the goal of the Fed and Treasury...I see no other explaination that makes sense. It explains the currency wars underway, why no real help is generated for the middle class recovery, why no political party is screaming "traitors" at the Fed and Treasury for destroying the value of the dollar. This big poker game ends in disaster, everyone knows it, but just which counrty remains standing in the aftermath is a roll of the dice. The USA is making a side bet monitary stand against all counrties right now, we go down and we take you with us. I think QE2 ( if it has not already been activated in the last few weeks) is a clear signal to the BRIC countries, the middle east, etc, that before they can unhook themselves from the dollar, the dollar will bring them to their knees. As prices rise, the unrest will spread around the world, the dollar IS the underground and unofficial currency of the world, everyone forgets that.
Everything...I repeat everything is being manulipated by madmen who think they are safe for the effects of their deeds.
i would like to see this. do you have a link? i did a search and it just turned up a long (60 pp. or so) working paper.
i would like to see this. do you have a link? i did a search and it just turned up a long (60 pp. or so) working paper.
Anger
Bargaining
Denial
Acceptance
In the unlikely event that the sheeple get to the Acceptance stage before they are starved (emotionally and/or physically) into submission is when things get real dicey. When the pie hits them in the face. Watch out!
Game theory + Flawed economic framework = Moar dollars!
Fannie and Freddie are up big. Doesn't PIMCO hold a lot of agency debt.
Bill loaded up on the stuff in 2008 (?) seconds before the govt announced they would back it. A smoking gun, plain as day crime. I think the SEC is looking into that.........
Me thinks there is some other housing bailout in the works and Pimpco got a heads up about it....something that will save (so they think anyway) housing market.
Papa, I'm there with you on that. TPTB know the time-bomb of the MBS' and I think they are ready and willing to head it off asap...got to get it off the front pages NOW! Where is the SEC? Following orders to look away. Another "goldman" type settlement coming soon!
Well, there is "H.R. 3808, the Interstate Recognition of Notarizations Act of 2010". Rumor has it now that the president will not sign it into law - but there is discussion as to whether or not he can use a pocket veto to send the bill back to the house.
Take a look for yourself - after the monstrously gargantuan Health Reform Act bill, this is a bit, shall we say, undersized?
http://frwebgate.access.gpo.gov/cgi-bin/getdoc.cgi?dbname=111_cong_bills...
A summary - electronic loan docs are OK, even if they are fraudulent, since you can't prove it once it been digitized....
So, if Mr Pim(p)Co has an inside track on the status of this bill, he may have the best buy ever on record! Just imagine, all of the MSM wringing their hands over the trillions of dollars of worthless MBS out there, so the price falls, and then WHAM! The shit's all good again! I think we need to keep an eye on the status of HR 3808, don't we?
Awww, I got junked. Is that you Bill Gross - am I on to your dirty little sectret?
Picture this - the Democrats are lagging in campaign donations, especially from the bankers. All the President has to do is threaten to veto one piece of legislation that would make this whole mess better. Next thing you know, his phone is ringing off the hook and his "boys" are rollin' in the dough.
Too far-fetched?
I'm with you too. Cognitive Dissonance says Ben can't do QE2 because of foreclosergate but I see it as the exact opposite. This will be shadow TARP II. Put it all on the Fed's books for now, and when no one is looking, just write it off.
yup. from Bill "wink wink" Gross' move you get the sense that QE2 = TARP II...this forclosuregate is so fucking huge it's like a herpes on Pamela Anderson's vajay-jay.
the very idea of these "financial products" these asshats formulate is beyond usury..of course the idea is foreign to most because people just don't get how you create $$ out of thin air.
that is unless you have a printer and some fancy linen paper papyrus
All that Agency MBS the Fed owns, while a derivative, is essentially based on agency debt. The principal and interest of agency debt are backed by the U.S. government.
How do I know that?
Because Ben Bernanke said so. On more than one occasion.
Why wouldn't Bill Gross be a buyer, since he knows he can get it at a discount-- yet still get the government guarantee???
In the worst case, PIMCO can pass it back to the investment banks if it all turns out to be fraudulent. Either way, he likely gets par on something he likely picks up at well less than par.
It beats owning more USTs....
dick fuld just came on cnbs to advise that lehman bros. is well-capitalized.
oops ... oh darn ... my bad
i meant that a BAC exec just released a statement that this whole mortgage mess is really No Big Deal™
Cannibalization time may be here. There is not enough trading profits to go around on the desks. Time for GS to pull a Lehman on BAC.
For those who weren't informed or didn't read the manual, it tastes like chicken. :>)
Taylor is on CNBC - Says he wouldn't do QE and moving rates to 75bp - 100bp would not be harmfull.
Somehow I trust him more than the Asshat Bernake....
+1
our last best hope is raising rates now, indicating more to come, and cutting gov't spending 10% across the board. Let businesses and banks fail. Austerity. And maybe Anarchy.
Wrong as hell.
the best hope is to repudiate the debt. It mathematically CANNOT be paid back!
Today's debts cannot be repaid plus interest except by MORE debt tomorrow! It is absolutely critical to understand this.
I hope Ben gets the shits and can't pull the trigger, and Gross gets wiped out.
They liquidated their MBS when QE1 was announced. Now they're going to liquidate their Treasuries....... Buy the rumor sell the news. They're just lining up the suckers.
I vote for outcome B. The demise of philately Billy and the Balboa broncos would be no less than significant to the end of rigged market capitalism as we know it
I'm too afraid to do anything except preserve what I have in a spider hole until the Mongol hordes are done looting and pillaging.
Buying heavily discounted lower rated MBS debt on the speculation that it will eventually get tossed back to the securitizers (who will be forced to eat the losses)?
Yeah... and... underlying agency debt has an ultimate backstop.
Either the investment bank eats the loss... or the taxpayer.
I'm sure our trusted leaders are working towards the latter. Or... investment banks eat private MBS and the taxpayers eat the rest of Fannie and Freddie losses.
CNBC:
Mozzillo settles with SEC after defrauding investors. In other news prison time no longer an option for the raindrop walkers.
more front-running. the sec is there to make sure that mozilo isn't punsihed. he probably called them and asked them for a slap on the wrist to deflect anyone else from trying to take an actual bite out of his ass. Enron is legal now.
67 Million dollars...lol
No admittance of guilt.Just amazing.
and BAC picking up most of the tab too...LOL
Actually, that's not really funny considering where BAC got the cash. Obviously the timing and nature of this settlement is all directly tied into the foreclosuregate fraud BAC is involved in. Now it's a given that the investigation into this fraud will simply be another fraud wrapped in a bunch of lies. Boy, the stench is unbearable...
I've got some shit for them to buy, its sitting on my front lawn now shovel ready.
The following depiction of a recent phone call is fictional and does not depict any actual person or event.
Ben: Hey, Bill. Ben here. Is Alan around?
Bill: Yea, sure. Hold on a sec.
Ben: Hey, Al. This is Ben. (...muffled whispers and a few ancient code words. Al then hangs up.)
Al: Hey Bill, I think it might be a good idea to shift the portfolio abit. Nothing major you know, just load up on the MBS for now.
Bill: Hey Mohamed. You get that down.
Mohamed: Yea we're good. The server's right down on the exchange. It's done. By the way, you sure we're good to do it on margin.
Bill: Yea, we're good.
http://therookiecynic.wordpress.com/2010/09/27/my-lovehate-relationship-...
I'm puzzled as to why we see strength in the USD today.....QE is a dollar killer, no?
The thought is that the Fed will buy all net treasury issuance next year, so the Chinese/Japanes/Korean bloc will have to start buying agencies . . . .
OMG... I think I now see the pure GENIUS of what is unfolding.
The title/conveyancing problems are at the root of the foreclosure problem.
This is causing problems for MBS.
The banks are in trouble.
QE2 is on the way.
Answer: inject money into the economy by making the MBS owners whole again. Not yet quite sure of the mechanism but seems like a Jesus moment is coming ... "come to me and I will wash away your sins."
Is this the bet that Bill Gross is making ?
Deag.
Anyone seen Leo ??? Sell Sell Sell ...
US Plans Inquiry on China's Subsidies of Clean Energy New York Times - Sewell Chan, Keith Bradsher - 22 minutes ago The Obama administration announced Friday that it would investigate a complaint accusing China of illegally subsidizing its clean-energy industries, in another sign of its newly assertive posture over China's trade and ...'Who cares what Benny and the Inkjets blink in morse code when you have the one and only Bill Gross'.
People, we are in the presence of journalistic greatness here. Thank you TD.
Sure he will double down at margin on MBS.
If it doesn't work out..and MBS unravel. Many banks and the fed will be hurting.
PIMCO will then declare that they are too big to fail.
It would be too risky to "the stability of the overall financial system".
Timing is everything, apparently...
SUMMARY: FinCEN has begun the design of a new Bank Secrecy Act (BSA) database (the Database) and invites comment on the list of proposed data fields within the Database that will support Suspicious Activity Report (SAR) filings by financial institutions required to file such reports under the BSA.
http://cryptome.org/0002/fincen101510.htm
I'm wondering about this as some huge headfake to gun the markets into election period.
The FED is already sending out mixed messages:
1) St. Louis FED is revolting against NY FED and saying QE2 is for losers
2) Bernanke saying that more easing will have to be done cautiously-ie: not the big 3 trillion printer
But, after election, whatever incumbents they save are in office for 2-8 more years. So, maybe they let the market off for a bit.
As someone here mentioned, bond yields are jumping. The 10 year jumped .92. That's not particularly bullish for the 10-30 years. So, who's dumping and why. Is Gross frontrunning the anticipated FED decision by playing along with the QE2 expectation and then will sell to suckers before Bernanke disappoints?
The fact that MBS are now guaranteed by Treasury and FED is asking you to front-run them means that you're buying higher-yielding treasury paper with shorter maturity.
So you're taking on short-term financing risk (none, FED says so, all players agree, won't matter until some players show dissent) to get higher-yields (no default risk, Treasury says so). you are taking on prepayment risk, and you get exposure to medium maturities as opposed to long maturities.
Biggest plus, is that FED will gladly repo finance it for you, so for the next few years you can effectively borrow between 0.25 and 0.5% and get 3-5% MULTIPLIED 5-10 times leverage.
This is the most risk-free trade that exists out there.
Once again, quality of the underlying paper doesn't matter as Tres saying they will guarantee it.
Short-term QE is quite possible, but if you're betting on QE to infinity, you can't afford to forget that four hawks will rotate into the voting seats of the FOMC next year, and two of the most aggressive doves are going out. New voters in 2011: Plosser, Fisher, Evans, Kocherlakota. Look up some of their remarks and try to guess how much the balance of power will change. It could be tough for Ben B to get to infinity on a two month timeline, but that doesn't mean he won't try.
msg moved
Maybe Gross is buying old rotten MBS at a discount so he can force it back on the banks at par for screwing up the chain of title...
Ick-a-fracka, firecracka, zip boom baa! POMO - POMO - RAH RAH RAH
- Benny Bunny
new aplha trade Long GOOG, AAPL< INTC short the THE BANKS
It doesn't matter what Bill Gross does. The big banks are collapsing as we speak. Bank of America looks like it's on its last legs. The volume in the sell-off is huge, as is the volume in the sell-off on JPM and Citigroup.
yup. volume sure is present
If Tyler is right, we could see a run on da banks Monday. What would that do to markets?
http://www.cnbc.com/id/39686897?__source=yahoo|headline|quote|text|&par
Surprise coming from CNBS...but he's probably right
When PIMCO blows up we can all go home
An asymptotic view of the monitization
http://www.marketwatch.com/story/story/print?guid=09E128DC-D61C-11DF-9252-00212804637C
Guess who's moving up the who's who of CDS's?
Cheeky...wish you would contribute again. ZH is not the same without you. Have learned a lot from your insight. Hope you will reconsider.
GOLD updated chart showing parabolic move.
http://stockmarket618.wordpress.com
Question.
If the fed does announce QE2 in the form of MBS security purchases instead of UST, would this then be a move that would precipiate a fall out in the heated treasury bond market?
Really this is a great post from an expert and thank you very much for sharing this valuable information with us.
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